The SARS-CoV-2 a.k.a. COVID-19, the newly identified infection, also dubbed as coronavirus, first detected in China in December, has now become a pandemic, as per the World Health Organization. It has spread all across the world, and some experts say, the peak is not there yet. All major authorities in the world are gearing up to face a steep increase in the number of cases and deaths, as predicted by medical experts.
Silicon Valley is on a pause, Europe is on a lockdown, and in the UK, including the whole world, companies are asking employees to work from home and cut on their travel. While all the industries across the globe are wrestling with all kinds of issues, one industry which has been hit the hardest is the travel industry. This is because many countries, including Italy, France, Spain, the US and more have closed borders to stop the spread of the virus, or have placed extra restrictions on arrivals.
Reportedly, 80% of the major airlines’ flights like Virgin Atlantic, British Airways, easyJet and more are being temporarily cancelled. Air travel companies are asking their staff to go on several weeks of unpaid leaves. Shares of Aviation and tourism companies are decreasing, and experts in the travel industry are calling it ‘a nuclear winter.’
In such a scenario, we at Silicon Canals are extremely concerned about how the European travel tech startups are planning to face the impacts of this sudden coronavirus outbreak. So we spoke to Omio, GetYourGuide, TravelPerk and Bidroom — 4 leading travel tech startups of Europe to understand how they are coping in this unimaginable world crisis.
COVID-19: The impact on travel tech startups!
Omio spokesperson, Boris Radke, says, “As a travel-booking platform, we’ve experienced a tangible impact on our business and have seen that impact in near real-time: first, bookings by customers in China were impacted, then US customers cancelled their Easter trips to tourist spots such as Italy, and now domestic bookings are being impacted across Europe. We’re seeing a drop of at least 30-50% in bookings per market as restrictions are imposed.”
Based in Berlin, Omio is a multi-modal travel booking platform where users can compare prices, schedules, duration, and other variables for several routes in both markets at-a-glance. At present, Omio is available in 21 languages and attracts an average of 27 million users per month from more than 120 countries. The German company is a great example of success in the European travel tech startup scene as it has secured nearly €269 million, since founded in 2012 by Naren Shaam.
Further, adding to the discussion, JC Taunay-Bucalo, the Chief Commercial Officer of one of the most distinguished Spanish travel tech platforms, TravelPerk adds, “The coronavirus outbreak has had a profound impact on companies of all shapes and sizes. Businesses in the travel industry have been some of the worst affected. Globally, we’ve seen a more than 50% decrease in bookings on the TravelPerk platform, and for some of the worst-affected countries, this number stands at more than 90%.”
Since founded in 2015, TravelPerk offers the next-generation business travel experience for companies. It lets companies book and manage their travel via its platform. It is free-to-use and the startup lets users search flights and hotels and book and pay for the same. Founded by Avi Meir, Javier Suarez, Ron Levin, the Barcelona-based company has scored €122 million funding so far.
Johannes Reck, the CEO of Europe’s very successful and well-known travel company GetYourGuide also commented on the situation. He adds, “People are putting new trip planning on hold. Globally, bookings for new experiences are down more than 70% on GetYourGuide vs. our demand forecasts for the past three weeks.”
He further adds, “Fortunately, we’re a well-capitalised company and are prepared to navigate this period, and our community is our highest priority. That’s why we’ve increased the flexibility of our refund policy. All bookings that are cancelled more than 24 hours in advance or are affected by closures qualify for a full refund, no questions asked.
Berlin-based GetYourGuide was founded in 2009 by Jochen Mattes, Johannes Reck, Martin Sieber, Pascal Mathis, Tao Tao, and Tobias Rein. Back in May 2019, the tech company secured a huge funding of €500 million from SoftBank, and now values more than $1 billion. In total, the company has raised a funding of €595 million so far.
Johannes Reck says, “We’re also taking this opportunity to work on our tech, our infrastructure and improve the quality and diversity of experiences travellers can book with GetYourGuide, and make sure we have everything in place for when travel picks up again.”
He further adds, “As we navigate this situation, we are watching key-indicators to determine current travel appetite and continuously learning from our own real-time customer feedback to inform our decision-making and plans for an inevitable tourism upswing.”
A fierce competitor to Booking.com, Amsterdam-based travel booking platform Bidroom is also bracing itself for further impact. The company’s spokesperson informed that, “Around 100 team members of Bidroom in Krakow are all working from home. In the short term, the company will focus on promoting domestic travel (within a country) and start working on marketing strategies to build up people’s desire to travel, so that they know where they want to go — when government medical authorities say it’s safe to travel again.”
The Dutch startup was founded in 2015 by Casper Knieriem and Michael Ros in Amsterdam. It is an online membership-based hotel platform with 0% booking commission and discount hotel pricing of 5% to 25%. It works with 120,000 hotels across 128 countries and has raised €18.1 million funding on the whole.
Fighting against the impact: Customer is king!
So, what are the strategies of these companies to deal with customer refunds and long-term loyalty?
On this JC Taunay-Bucal says, “TravelPerk has taken a number of actions to confront the impacts of the coronavirus head-on. We’ve partnered with International SOS, who offer 24/7 COVID-19 support and will assist with repatriating any customers’ stranded members of staff. We’re also offering our premium ‘concierge’ customer service features free to all customers, giving everyone access to human support.”
Asking on how their teams are working, JC Taunay-Bucal says, “For our own employees, we have instituted a 100% remote working policy. Face-to-face interaction is important to what we do, but we think it’s more important to ensure the safety of our employees.”
Other companies agree on the same and addin to the matter, Johannes Reck, from GetYourGuide says, “Our customer service is fully operational 24/7, and we’ve already made significant changes and upgrades in our internal processes to ensure we’re ready to handle the developing situation.”
“Regarding our cancellation policy and refunds, for any customers who change travel plans or cancel a booking, we offer the following: Customers who cancel a booking more than 24 hours in advance will receive a full refund. Customers who cancel a booking within 24 hours of the planned start time will receive a credit redeemable for the full value of their booking. Customers with a booking to an attraction that has closed as a preventative measure will be contacted by GetYourGuide and receive a full refund.”
Omio spokesperson also says that their customer service team is working around the clock to handle enquiries from customers who have booked and many colleagues from other teams have volunteered to help us handle even more cases. “We’re liaising closely with our partner transport providers to get information on changes to their cancellation/rebooking policies as they happen, but in many cases we need to ask customers to contact the provider direct – so we created this live list of policies from providers around the world, to help people have clearer information. “
“In terms of other measures, we have very efficient marketing channels and the ability to increase or decrease our spend quickly. We’re also well-funded. We fundamentally believe in travel and that in the coming months, people will again travel – for holidays, work, or simply to visit loved ones. So we’re using the time now to prepare for this and make sure we’re ready to respond to customer needs once travel starts picking up again.”
TravelPerk wants to use this opportunity to give their customers the best treatment possible, JC Taunay-Bucalo says, “Our approach has been to double down on customer satisfaction and loyalty. We know lots of our customers are worried, and need information and help with their bookings. So to meet the big increase in requests coming in, we’ve switched some of our sales team to customer support, and we’re keeping a close eye on our customer happiness metrics.”
“We also have FlexiPerk, our refund solution which allows customers to get their money back on bookings cancelled at any time for any reason. We designed this product to help our customers deal with the unavoidable uncertainty of business travel. The level of disruption to travel as a result of the coronavirus has been unexpected and unprecedented, but FlexiPerk has provided our customers with some peace of mind.”
What about partners’ problems?
As a response all these travel tech companies have been trying to be very supportive to their partners. Michael Ros, CEO, Bidroom says, “As a support to our hotel colleagues that are massively suffering in these turbulent times, we have decided to waive the membership fee for all hotel members in 2020. Which means, making your bookings via Bidroom will be completely free of any charges. We believe that by supporting and helping each other, we will win this battle and come back even stronger, together!”
Adding to this, JC Taunay-Bucalo from TravelPerk says, “Our relationship with our partners has not changed and we don’t anticipate any changes to the way we work with travel providers in the long-term. We take pride in having the world’s largest travel inventory and we’ll continue to work closely with airlines, hotels, car rental and rail companies throughout and following this period of difficulty for the industry.”
Commenting on the state of suppliers, Johannes Reck, from GetYourGuide concludes, “This is a serious time for our suppliers. We’re in constant contact with our vast network of local operators, and have been providing them with data, trends and tips on how to keep running their business or how to recover from a long term closure and be ready for the tourism upswing. We are currently working with them to launch new GetYourGuide Originals.”
Are you a travel tech startup in Europe suffering in these recent rough market waves caused due to coronavirus outbreak? What steps are you taking to face the impact? Let us know in the comments section below.